“During the first nine Interim Report months, corporate ... · Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Operating income SEK bn * Adjusted for one- off effects Operating profit SEK bn 10.8

SEB Interim Report January-September 2013 1

Interim Report January – September 2013 STOCKHOLM 24 OCTOBER 2013

“During the first nine months, corporate sentiment improved. Our income growth reflects SEB’s profile as an advisory and activity driven bank.” Annika Falkengren

SEB Interim Report January – September 2013 2

Interim report January - September 2013

9.7 9.6 9.610.6 10.3

Q3-12 Q4-12 Q1-13 Q2-13 Q3-13

Operating incomeSEK bn

* Adjusted for one-off effects

Operating profitSEK bn

10.811.9

11.0

14.013.4

Q3-12 Q4-12 Q1-13 Q2-13 Q3-13

Return on EquityPer cent

13.3 13.1 13.414.2

15.0

Q3-12 Q4-12 Q1-13 Q2-13 Q3-13

Common Equity Tier 1 ratio (Basel III)Per cent

First nine months 2013 – SEK 13.1bn operating profit

• Operating profit SEK 13.1bn (11.4).

• Operating income SEK 30.5bn (29.2). Operating expenses SEK 16.6bn (17.1).

• Net interest income SEK 13.9bn (13.2), net fee and commission income SEK 10.8bn (9.9) and net financial income SEK 2.9bn (3.6).

• Net credit provisions SEK 0.8bn (0.7) and a credit loss level of 0.08 per cent (0.08).

• Net profit SEK 10.6bn (8.4).

• Return on equity 12.8 per cent (10.8) and earnings per share SEK 4.82 (3.83).

Third quarter 2013 – SEK 4.6bn operating profit

• Operating profit SEK 4.6bn (3.9).

• Operating income SEK 10.3bn (9.7). Operating expenses SEK 5.5bn (5.6).

• Net interest income SEK 4.8bn (4.5), net fee and commission income SEK 3.7bn (3.2) and net financial income SEK 0.8bn (1.1).

• Net credit provisions SEK 0.3bn (0.2) and a credit loss level of 0.08 per cent (0.11).

• Net profit SEK 3.8bn (2.8).

• Return on equity 13.4 per cent (10.8) and earnings per share SEK 1.71 (1.29).

Volumes • Lending to corporates increased by SEK 24bn and lending to households by

SEK 20bn from year-end. Lending to the public amounted to SEK 1,282bn.

• Deposits from corporates increased by SEK 35bn and from households by SEK 4bn from year-end. Deposits from the public amounted to SEK 923bn.

• Assets under management amounted to SEK 1,427bn, including a net inflow of SEK 18bn from year-end.

Capital and funding • The core Tier 1 capital ratio was 17.4 per cent and the Tier 1 capital ratio

was 18.7 per cent. The Common Equity Tier 1 ratio (Basel III) was 15.0 per cent.

• The liquidity coverage ratio was 114 per cent.

• The core liquidity reserve amounted to SEK 438bn and the total liquid resources amounted to SEK 702bn.


President’s comment

The world economy continues to move in the right direction with business sentiment gradually improving. However, the recovery is still not strong enough to provide immunity to economic, financial and political setbacks and the long-term implications of the US debt situation remain to be seen. Central banks’ liquidity support still plays a key role for real growth, even in the US where activity levels have been more robust than in Europe. Although the risk for worst-case scenarios for the eurozone is fading, the long-term economic challenges for the region remain. This is in contrast to Asia where the prerequisites for economic growth are more evident. Higher profitability and capital generation SEB’s third quarter operating profit of SEK 4.6bn was up 20 per cent compared to a year ago. As an advisory and activity driven bank, SEB benefits from a more positive corporate sentiment. This was evidenced by higher net interest income as well as higher net fee income. Operating income grew by 7 per cent, while costs were 3 per cent lower.

We continue to grow in our core segments and attract an increasing number of new customers. Outside of Sweden we have again demonstrated the strength in our Nordic and German corporate and institutional platform as the credit portfolio has grown by 12 per cent since year-end and income by 10 per cent compared to the third quarter 2012. In Private Banking, SEB continued to attract strong net inflows of assets under management - year to date SEK 23bn.

Asset quality remained high. The level of net credit losses was 8 basis points in this quarter and non-performing loans decreased. SEB capital position strengthened further resulting in a Common Equity Tier 1 ratio (Basel III) of 15.0 per cent. Return on equity was 13.4 per cent in the quarter and 12.8 per cent for the first nine months of 2013.

Deepened customer relationships In Merchant Banking, we continue to deepen relationships with our existing customers by growing ancillary business. In the third quarter, demand for corporate and investment banking services increased while customer activity within Markets reflected seasonal slowdown. Corporate lending volumes increased marginally at the same time as SEB continued to support customers in tapping the bond market. One recent example is the Green Bond that the City of Gothenburg issued during September. Green Bonds support the financing of projects mitigating effects of climate change and here SEB has a pioneer position globally.

In Retail Banking, we offer customers a full service offering with high accessibility in different channels making it easier for customers to interact with us. Our telephone bank which offers 24/7 personal advisory services in 23 languages plays a key role, as do digital channels. During the autumn we launched a new mobile application as well as an upgraded internet bank. Today we attract close to 55,000 more SMEs and 60,000 more private individuals as full service customers than five years ago. More regulation may not be the right regulation A key take-away from the last five years has been the value of a strong balance sheet in turbulent times. Ample liquidity and strong capital ratios ensure resilience to future possible system shocks as well as capacity to invest in and support long-term relationships. Swedish banks have been at the forefront and have significantly strengthened their balance sheets.

The ambition of the new regulatory framework is to establish efficient interfaces between supervision at the macro and micro levels. The ambition is admirable but it remains difficult to assess the impact on the real economy. The framework is still not finalised and it thus remains difficult for customers to fully grasp the effects on their businesses. The world is complex with high interconnectivity and interdependencies and, as such, great care must be taken to avoid un-intended consequences. Gradual implementation and evaluation of new regulations are necessary.

Our strategic direction remains firm We strive to facilitate our customers’ business opportunities. The guiding principle for us in developing our business is and has been long-term relationships as the foundation for long-term profitability. The continued progress of SEB’s franchise and financials is a testament to the relevance of this strategy to our customers and owners.

Income +7% Costs -3%

SEK 23bn net inflow in Private Banking

15% Common Equity Tier 1 ratio

Jan-Sep 2013

Q3 2013

Basel III, Sep 2013


The Group Third quarter isolated Operating profit amounted to SEK 4,618m (3,857). Net profit from continuing operations was SEK 3,753m (2,989). Net profit (after tax), including the net result from discontinued operations, amounted to SEK 3,753m (2,834).

Operating income Total operating income amounted to SEK 10,324m (9,681).

Net interest income increased to SEK 4,759m (4,466).

The customer-driven net interest income increased by SEK 281m, or 7 per cent, compared with the third quarter in 2012. Higher volumes offset the negative effect from lower short-term rates. Compared with the previous quarter, the customer-driven net interest income increased by SEK 159m, or 4 per cent. There were small positive margin and volume effects.

Net interest income from other activities was virtually flat compared with the corresponding quarter 2012 and was SEK 77m lower than the previous quarter. Funding costs decreased in the third quarter 2013, as well as yields on the liquidity portfolio and other interest-earning securities.

Net fee and commission income amounted to SEK 3,735m (3,192), an increase of 17 per cent year-on-year and a decrease of 2 per cent since the previous quarter. Compared to the third quarter 2012, higher corporate activity in the debt and syndication markets and increased investment banking activity, though still on a low level, supported income generation. In the previous quarter Securities Finance related income was seasonally high and Wealth Management recorded high performance fees. Customer activity displayed normal seasonality and was lower in the third quarter.

Net financial income amounted to SEK 825m (1,091), a decrease of 24 per cent compared to both the second quarter and year-on-year. Customer activity and market volatility were lower in the third quarter 2013 and there was high uncertainty about the macroeconomic development, especially in the United States, which affected trading activities and the Treasury related result.

Net life insurance income decreased to SEK 794m (861), but increased by 15 per cent compared to the second quarter. The negative impact from higher long-term interest rates and declining stock markets on the life portfolios during the second quarter was partially reversed in the third quarter.

Net other income amounted to SEK 211m (71).

Operating expenses Total operating expenses amounted to SEK 5,453m (5,639), a decrease of 3 per cent year-on-year.

Credit losses and provisions Provisions for credit losses amounted to SEK 267m (186). The credit loss level was 8 basis points.

Non-performing loans decreased by SEK 2.3bn in the third quarter and amounted to SEK 10.2bn. Write-offs of non-performing loans to reserves in Latvia and Lithuania increased. One year ago, the non-performing loans amounted to SEK 14.6bn.

Individually assessed impaired loans amounted to SEK 5.2bn and the portfolio assessed loans past due >60 days amounted to SEK 4.5bn.

Income tax expense Total income tax expense was SEK 865 (868), which corresponded to an effective tax rate of 19 per cent.

Discontinued operations The net result from discontinued operations was SEK 0m (-155).

Other comprehensive income Other comprehensive income increased to SEK 2,356m (154). Pension obligations decreased with SEK 2,455 (-99). The main reason was an increase of the market-derived discount rate for calculating the Swedish pension obligations from 2.8 to 3.8 per cent (3.1). The discount rate in Germany remained unchanged.

The strengthening of the Swedish krona had a negative impact from translation of foreign operations, compared to a positive impact in the second quarter.

Comparative numbers - in parenthesis - for the income statement refer to the corresponding period 2012. Business volumes are compared to 30 September 2012 unless otherwise defined.

Q3 Q2 Q3SEK m 2013 2013 2012Customer-driven NII 4 286 4 127 4 005NII from other activities 473 550 461Total 4 759 4 677 4 466


The first nine monthsOperating profit increased by 15 per cent to SEK 13,118m (11,396).

Net profit from continuing operations was SEK 10,573m (8,902). Net profit (after tax), including the net result from discontinued operations, amounted to SEK 10,556m (8,415).

Operating income Total operating income amounted to SEK 30,523m (29,186).

Net interest income increased to SEK 13,895m (13,177).

The customer-driven net interest income increased by SEK 611m, or 5 per cent, compared to the first nine months 2012. This was due to volume growth and stable net interest margins despite the lower short-term rates. Average volumes of loans to and deposits from the public for the first nine months grew by 3 and 7 per cent, respectively.

Net interest income from other activities increased by SEK 107m year-on-year. Funding costs decreased. The yield in the liquidity portfolio and on other interest-earning assets decreased to a lesser degree.

Net fee and commission income was SEK 10,793m (9,905). Compared to the first nine months 2012, the average value of assets under management and stock exchange turnover increased. In particular, higher corporate activity in the debt and syndication markets and increased investment banking activity increased lending and syndication fees by SEK 518m in the same period.

Net financial income decreased to SEK 2,866m (3,597). The main reason for the reduction was the unusually high valuation gains on the liquidity portfolio in 2012. In addition, lower volatility in the uncertain markets resulted in lower income in 2013.

Net life insurance income amounted to SEK 2,365m (2,597). Unit-linked income was up 5 per cent, while the higher long-term interest rates had a negative impact on traditional life portfolios.

Net other income amounted to SEK 604m (-90). In 2012, there were realised losses from the sale of securities. In 2013, there were instead gains from the sale of securities as well as positive hedge accounting effects.

Operating expenses Total operating expenses decreased by 3 per cent compared to the first nine months 2012, to SEK 16,626m. Staff costs were 3 per cent lower and the number of employees was 5 per cent lower. Other expenses fell by 6 per cent. Credit losses and provisions Provisions for credit losses amounted to SEK 814m (661). The credit loss level amounted to 8 basis points for the first nine months. The provisions for credit losses for the Group, excluding the Baltic region, equaled a credit loss level of

6 basis points for the first nine months. The provisions in the Baltic region increased compared with the same period 2012 and corresponded to a credit loss level of 32 basis points for the first nine months.

Non-performing loans amounted to SEK 10.2bn, which was 30 per cent lower than one year ago, and which reflected a continued strong asset quality.

Individually assessed impaired loans decreased by SEK 3.2bn compared to one year ago while the portfolio assessed loans past due >60 days decreased by SEK 1.1bn.

Income tax expense Total income tax expense was SEK 2,545m (2,494), which corresponded to an effective tax rate of 19 per cent, in line with the estimated effective tax rate of 20 per cent for the full year 2013.

Discontinued operations The net result from discontinued operations was SEK -17m (-487).

Other comprehensive income The net result from other comprehensive income was SEK 2,584m (-316). The net revaluation of the defined benefit pension plan in Sweden, in accordance with IAS 19, had a positive effect of SEK 3,140m (-445). Pension plan assets in Sweden appreciated. At the same time, the market-derived discount rate for Swedish pension obligations increased to 3.8 per cent (3.1), with a corresponding decrease in pension obligations.

The net effect from the valuation of balance sheet items that may subsequently be reclassified to the income statement, e.g. cash-flow hedges and available-for-sale financial assets, was a negative contribution of SEK 556m (in 2012, positive 129m).

Business volumes Total assets at 30 September 2013 amounted to SEK 2,569bn (2,399). Loans to the public increased to SEK 1,282bn, an increase of SEK 43bn during the last 12 months and of SEK 45bn since year-end.

Sep Dec SepSEK bn 2013 2012 2012Public administration 53 55 54Private individuals 487 467 455Corporate 637 613 597Repos 83 76 104Debt instruments 22 25 28Loans to the public 1 282 1 236 1 238 Deposits from the public amounted to SEK 923bn, up by SEK 61bn and SEK 111bn, from year-end and one year ago respectively.

SEB’s total credit portfolio amounted to SEK 1,845bn (1,735). At year-end, the credit portfolio amounted to SEK 1,777bn. Compared with 30 September 2012, household

ChangeSEK m 2013 2012 %Customer-driven NII 12 480 11 869 5NII from other activities 1 415 1 308 8Total 13 895 13 177 5

Jan - Sep


volumes increased by SEK 32bn. The combined corporate and property management portfolios increased by SEK 67bn in the same period.

At 30 September 2013, assets under management amounted to SEK 1,427bn (1,271). This was an increase from the year-end level of SEK 1,328bn. The net inflow of assets for the first nine months 2013 was SEK 18bn and the market value increased by SEK 81bn. Assets under custody amounted to SEK 5,814bn (4,788).

Market risk The trading business is customer flow-driven. This is confirmed by the fact that there were only four loss-making days during the first nine months. During the first nine months of 2013, Value-at-Risk in the trading operations averaged SEK 148m. On average, the Group is not expected to lose more than this amount during a period of ten trading days, with 99 per cent probability.

Liquidity and long-term funding SEB’s loan-to-deposit ratio was 130 per cent (138), excluding repos and debt instruments. During the first nine months, SEK 48bn of long-term funding matured and SEK 89bn was issued. 64 per cent of the new issuance was covered bonds.

The core liquidity reserve at the end of September 2013 amounted to SEK 438bn (348). The total liquid resources, including net trading assets and unutilised collateral in the cover pool, amounted to SEK 702bn (623). As of 1 January 2013, the Swedish Financial Supervisory Authority requires a Liquidity Coverage Ratio (LCR), according to rules adapted for Sweden, of 100 per cent in total and in EUR and USD, separately. At the end of the period, the LCR was 114 per cent (154). The USD and EUR LCRs were 123 and 239 per cent, respectively.

SEB’s internal structural liquidity measure, the Core Gap which measures the proportion of stable funding in relation to illiquid assets, increased to 118 per cent reflecting the Bank’s commitment to a stable funding base. SEB’s structural liquidity measure according to the Swedish Central Bank in its Financial Stability Reports has been in the mid-eighties in the last years. The Basel Committee’s Net Stable Funding Ratio (NSFR) is still a crude measure in its current form and it remains subject to review internationally.

Capital position During 2013, SEB continued to align the framework for capital allocation to the Basel III regulation. This was done by allocating more capital, in the amount of SEK 23bn, to the divisions from the central function in the first quarter 2013.

Both the core Tier 1 and the Tier 1 capital ratios improved in the first nine months. The growth of risk-weighted assets for credit risk was offset by a decrease in market risk RWA.

In May 2013, the Swedish Financial Supervisory Authority decided to implement a 15 per cent risk weight floor on Swedish mortgages. The floor will be implemented as a so-called Pillar 2 charge and the capital ratios which are reported according to Pillar 1 (in the adjacent table), will not be

affected. SEB has already allocated additional capital to the residential mortgage business in line with the stipulated risk-weight floor.

Based on an average risk-weight of 7.9 per cent for the

Swedish residential mortgage lending under Pillar 1 at 30 September 2013, the additional Pillar 2 risk-weighted assets would amount to SEK 28bn. The Swedish Common Equity Tier 1 requirement of 12 per cent (from 2015) means that SEB, at 30 September, would be required to hold additional Common Equity Tier 1 capital in the amount of SEK 3.3bn, which would correspond to approximately 58 basis points on the Common Equity Tier 1 capital ratio under Pillar 1.

Rating SEB's long-term senior unsecured ratings are ‘A1’ (stable outlook) by Moody’s and ‘A+’ (stable outlook) by Fitch. Standard & Poor’s SEB rating of ‘A+’ has a negative outlook due to S&P’s negative outlook on the macroeconomic situation in Sweden.

Long-term financial targets SEB’s long-term financial targets are to: - pay a yearly dividend that is 40 per cent or above of the

earnings per share, - target a Common Equity Tier 1 ratio (Basel III) of 13 per

cent, and - generate return on equity that is competitive with peers. This means that the Bank in the long-term aspires to reach a return on equity of 15 per cent.

As of 30 September 2013, the Common Equity Tier 1 ratio (Basel III) was 15.0 per cent and the return on equity for the first nine months was 12.8 per cent.

Risks and uncertainties During the autumn, the uncertainty around a potential United States default on its issued securities as well as the Federal Reserve Bank’s potential reduction of its liquidity support to financial markets have characterised the markets. The short-, medium- and long-term direct and indirect effects are difficult to assess. It once again underlines that the macroeconomic environment is the major driver of risk to the Group’s earnings

Sep Dec Sep2013 2012 2012

Basel IICore tier 1 capital ratio, % 17.4 15.1 16.5Tier 1 capital ratio, % 18.7 17.5 18.9RWA, SEK bn 574 586 591Including transitional floor:Core tier 1 capital ratio, % 11.0 10.1 11.3Tier 1 capital ratio, % 11.8 11.6 12.9RWA, SEK bn 911 879 860

Basel III

Common Equity Tier 1 capital ratio, %* 15.0 13.1 13.3* Estimate based on SEB's interpretation of future regulation.


and financial stability. In particular, it affects the asset quality and thereby the credit risk of the Group.

The medium-term outlook for the global economy is characterised by uncertainty. The global policy measures to limit the risk of severe shocks to the economy have created more stability to the financial system. However, a prolonged period of weak economic growth cannot be ruled out.

SEB assumes credit, market, liquidity, operational and life insurance risks. The risk composition of the Group, as well as the related risk management, are further described in SEB’s Annual Report.

The international Basel III regulatory framework in relation to capital, liquidity and funding standards could have long-term effects on asset and liability management and profitability of the banking sector. These aspects remain to be decided and implemented in Sweden, while the EU has adopted the regulatory framework.

Proposed reduction of Finnish corporate tax The Finnish government has proposed a reduction of the corporate tax rate from 24.5 per cent to 20 per cent from 1 January 2014. The parliamentary resolution is expected in December this year.

If the proposal is implemented, the Group’s deferred tax assets and deferred tax liabilities subject to Finnish income tax will then be revalued at 20 per cent, which is expected to have a positive one-off effect of approximately SEK 250m in the fourth quarter 2013. The effect going forward is small.


Stockholm, 24 October 2013

The President declares that the Interim Accounts for January-September 2013 provide a fair overview of the Parent Company’s and the Group’s operations, their financial position and results and describe material risks and uncertainties facing the Parent Company and the Group.

Annika Falkengren President and Chief Executive Officer

Press conference and webcasts The press conference at 9 am (CET) on 24 October 2013 at Kungsträdgårdsgatan 8 with President and CEO Annika Falkengren can be followed live in Swedish on www.sebgroup.com/sv/ir. A simultaneous translation into English will be available on www.sebgroup.com/ir. A replay will also be available afterwards.

Access to telephone conference The telephone conference at 3 pm (CET) on 24 October 2013 with the President and CEO Annika Falkengren, the CFO Jan Erik Back and the Head of Investor Relations Ulf Grunnesjö, can be accessed by telephone, +44(0)20 7131 2799. Please quote conference id: 937472, not later than 10 minutes in advance. A replay of the conference call will be available on www.sebgroup.com/ir. Financial information calendar 5 February 2014 Annual accounts 2013 4 March 2014 Annual report 2013 25 March 2014 Annual general meeting 25 April 2014 Interim report January-March 2014 18 July 2014 Interim report January-June 2014 16 October 2014 Interim report January-September 2014

Further information is available from: Jan Erik Back, Chief Financial Officer Tel: +46 8 22 19 00 Ulf Grunnesjö, Head of Investor Relations Tel: +46 8 763 85 01, +46 70 763 85 01 Viveka Hirdman-Ryrberg, Head of Corporate Communications Tel: +46 8 763 85 77, +46 70 550 35 00 Skandinaviska Enskilda Banken AB (publ) SE-106 40 Stockholm, Sweden Telephone: +46 771 62 10 00 www.sebgroup.com Corporate organisation number: 502032-9081 Additional financial information is available in SEB’s Fact Book which is published quarterly on www.sebgroup.com/ir.


Accounting policies This Interim Report is presented in accordance with IAS 34 Interim Financial Reporting. The Group’s consolidated accounts have been prepared in accordance with the International Financial Reporting Standards (IFRS) and interpretations of these standards as adopted by the European Commission. The accounting follows the Annual Accounts Act for Credit Institutions and Securities Companies (1995:1559) and the regulation and general guidelines issued by the Swedish Financial Supervisory Authority: Annual reports in credit institutions and securities companies (FFFS 2008:25). In addition, the Supplementary accounting rules for groups (RFR 1) from the Swedish Financial Reporting Board have been applied. The Parent company has prepared its accounts in accordance with Swedish Annual Act for Credit Institutions and Securities Companies, the Swedish Financial Supervisory Authority’s regulations and general guidelines (FFFS 2008:25) on annual reports in credit institutions and securities companies and the supplementary accounting rules for legal entities (RFR 2) issued by the Swedish Financial Reporting Board.

As of the 2013 financial year, IFRS 13 Fair Value Measurement comes into effect for application in the EU. The

standard contains joint principles for fair value measurement of most assets and liabilities at fair value, and for which information about fair value must be disclosed. The application of IFRS 13 does not affect the reported values for financial instruments to any material degree. In accordance with IAS 1 Presentation of Financial Statements the presentation of Comprehensive Income has been amended so that items that can be reclassified to profit or loss later are separated from the items that cannot. In addition to this, amendments in IFRS 7 Financial Instruments: Disclosures and the introduction of IFRS 13 require further disclosures about off-setting of financial instruments and financial instruments at fair value. In all other material aspects, the Group’s and the Parent company’s accounting policies, basis for calculations and presentations are unchanged in comparison with the 2012 Annual Report.

In 2012, SEB opted for early adoption of the amendments in IAS 19 Employee Benefits for defined benefit plans. More information regarding the restatement of comparable figures can be found on page 33 in the Annual Accounts 2012 and in note 54 of the Annual Report 2012.

Review report We have reviewed this report for the period 1 January 2013 to 30 September 2013 for Skandinaviska Enskilda Banken AB (publ). The board of directors and the CEO are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act for Credit institutions and Securities Companies. Our responsibility is to express a conclusion on this interim report based on our review.

We conducted our review in accordance with the Standard on Review Engagements SÖG 2410, Review of Interim Report Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing, ISA, and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act for Credit institutions and Securities Companies regarding the Group, and with the Swedish Annual Accounts Act for Credit institutions and Securities Companies, regarding the Parent Company.

Stockholm, 24 October 2013 PricewaterhouseCoopers AB Peter Nyllinge Authorised Public Accountant Partner in charge

Magnus Svensson Henryson Authorised Public Accountant


The SEB Group Income statement – SEB Group

Q3 Q2 Q3 Full yearSEK m 2013 2013 % 2012 % 2013 2012 % 2012Net interest income 4 759 4 677 2 4 466 7 13 895 13 177 5 17 635Net fee and commission income 3 735 3 811 -2 3 192 17 10 793 9 905 9 13 620Net financial income 825 1 087 -24 1 091 -24 2 866 3 597 -20 4 579Net life insurance income 794 689 15 861 -8 2 365 2 597 -9 3 428Net other income 211 384 -45 71 197 604 - 90 - 439Total operating income 10 324 10 648 -3 9 681 7 30 523 29 186 5 38 823

Staff costs -3 474 -3 613 -4 -3 602 -4 -10 643 -10 924 -3 -14 596Other expenses -1 457 -1 481 -2 -1 573 -7 -4 519 -4 816 -6 -6 444Depreciation, amortisation and impairment of tangible and intangible assets - 522 - 491 6 - 464 13 -1 464 -1 388 5 -2 612Total operating expenses -5 453 -5 585 -2 -5 639 -3 -16 626 -17 128 -3 -23 652

Profit before credit losses 4 871 5 063 -4 4 042 21 13 897 12 058 15 15 171

Gains less losses from disposals of tangible and intangible assets 14 11 27 1 35 - 1 1Net credit losses - 267 - 291 -8 - 186 44 - 814 - 661 23 - 937Operating profit 4 618 4 783 -3 3 857 20 13 118 11 396 15 14 235

Income tax expense - 865 - 975 -11 - 868 0 -2 545 -2 494 2 -2 093Net profit from continuing operations 3 753 3 808 -1 2 989 26 10 573 8 902 19 12 142

Discontinued operations - 17 -100 - 155 -100 - 17 - 487 -97 - 488Net profit 3 753 3 791 -1 2 834 32 10 556 8 415 25 11 654

Attributable to minority interests 2 1 100 4 -50 6 15 -60 22Attributable to shareholders 3 751 3 790 -1 2 830 33 10 550 8 400 26 11 632

Continuing operations Basic earnings per share, SEK 1.71 1.74 1.36 4.82 4.06 5.53 Diluted earnings per share, SEK 1.70 1.72 1.36 4.79 4.04 5.51

Total operations Basic earnings per share, SEK 1.71 1.73 1.29 4.82 3.83 5.31 Diluted earnings per share, SEK 1.70 1.72 1.29 4.78 3.82 5.29

Jan - Sep

Statement of comprehensive income – SEB Group

Q3 Q2 Q3 Full yearSEK m 2013 2013 % 2012 % 2013 2012 % 2012Net profit 3 753 3 791 -1 2 834 32 10 556 8 415 25 11 654

Items that may subsequently be reclassified to the income statement:Available-for-sale financial assets 248 - 65 376 -34 660 735 -10 1 276Cash flow hedges - 57 - 650 -91 687 -1 255 429 581Translation of foreign operations - 290 972 - 810 -64 39 -1 035 - 670

Items that will not be reclassified to the income statement:Defined benefit plans 2 455 - 91 - 99 3 140 - 445 -2 003Other comprehensive income (net of tax) 2 356 166 154 2 584 - 316 - 816

Total comprehensive income 6 109 3 957 54 2 988 104 13 140 8 099 62 10 838

Attributable to minority interests 1 2 -50 - 3 2 16 -88 22Attributable to shareholders 6 108 3 955 54 2 991 104 13 138 8 083 63 10 816

Jan - Sep


Balance sheet – SEB Group

30 Sep 31 Dec 30 Sep

SEK m 2013 2012 2012Cash and cash balances with central banks 259 103 191 445 187 126Other lending to central banks 5 964 17 718 21Loans to other credit institutions1) 113 819 126 023 122 655Loans to the public 1 281 543 1 236 088 1 238 048Financial assets at fair value * 780 341 725 938 717 178Available-for-sale financial assets * 46 074 50 599 49 170Held-to-maturity investments * 84 82 81Investments in associates 1 218 1 252 1 239Tangible and intangible assets 28 955 28 494 29 098Other assets 51 806 75 817 54 281Total assets 2 568 907 2 453 456 2 398 897

Deposits from central banks and credit institutions 215 761 170 656 212 928Deposits and borrowing from the public 923 143 862 260 811 901Liabilities to policyholders 302 925 285 973 280 231Debt securities 702 976 661 851 654 843Other financial liabilities at fair value 214 660 237 001 232 582Other liabilities 69 036 96 349 68 030Provisions 2 648 5 572 7 536Subordinated liabilities 22 087 24 281 24 184Total equity 115 671 109 513 106 662Total liabilities and equity 2 568 907 2 453 456 2 398 897* Of which bonds and other interest bearing securities including derivatives. 444 091 460 423 447 1761) Loans to credit institutions and liquidity placements with other direct participants in interbank fund transfer systems.

A more detailed balance sheet is included in the Fact Book.

Pledged assets, contingent liabilities and commitments – SEB Group

30 Sep 31 Dec 30 SepSEK m 2013 2012 2012 Collateral pledged for own liabilities1) 376 099 352 459 351 989 Assets pledged for liabilities to insurance policyholders 302 925 288 721 280 231Collateral and comparable security pledged for own liabilities 679 024 641 180 632 220

Other pledged assets and comparable collateral2) 139 120 135 372 250 219Contingent liabilities 97 710 94 175 91 517Commitments 451 159 407 423 399 360

2) Securities lending SEK 62,896m (66,675 / 49,671) and pledged but unencumbered bonds SEK 76,225m (68,697 / 68,409).1) Of which collateralised for covered bonds SEK 331,754m (320,859 / 307,118).


Key figures – SEB Group Q3 Q2 Q3 Full year

2013 2013 2012 2013 2012 2012

Continuing operationsReturn on equity, continuing operations, % 13.37 14.08 11.35 12.78 11.39 11.52Basic earnings per share, continuing operations, SEK 1.71 1.74 1.36 4.82 4.06 5.53Diluted earnings per share, continuing operations, SEK 1.70 1.72 1.36 4.79 4.04 5.51Cost/income ratio, continuing operations 0.53 0.52 0.58 0.54 0.59 0.61Number of full time equivalents, continuing operations1) 15 743 16 004 16 415 15 906 16 663 16 578

Total operationsReturn on equity, % 13.37 14.02 10.76 12.76 10.76 11.06Return on total assets, % 0.59 0.58 0.47 0.55 0.47 0.48Return on risk-weighted assets, % 1.63 1.66 1.31 1.56 1.32 1.36

Basic earnings per share, SEK 1.71 1.73 1.29 4.82 3.83 5.31Weighted average number of shares, millions2) 2 192 2 189 2 193 2 191 2 191 2 191

Diluted earnings per share, SEK 1.70 1.72 1.29 4.78 3.82 5.29Weighted average number of diluted shares, millions3) 2 206 2 208 2 198 2 207 2 199 2 199

Net worth per share, SEK 58.76 55.93 55.30 58.76 55.30 56.33Equity per share, SEK 52.72 49.93 48.60 52.72 48.60 49.92Average shareholders' equity, SEK, billion 112.2 108.2 105.1 110.2 104.0 105.2

Credit loss level, % 0.08 0.09 0.11 0.08 0.08 0.08

Liquidity Coverage Ratio (LCR)4), % 114 114 154 114 154 113

Capital adequacy including transitional floor5):Risk-weighted assets, SEK billion 911 929 860 911 860 879Core Tier 1 capital ratio, % 10.95 10.28 11.33 10.95 11.33 10.05Tier 1 capital ratio, % 11.77 11.12 12.94 11.77 12.94 11.65Total capital ratio, % 11.74 11.29 12.74 11.74 12.74 11.47

Capital adequacy without transitional floor (Basel II):Risk-weighted assets, SEK billion 574 593 591 574 591 586Core Tier 1 capital ratio, % 17.37 16.10 16.51 17.37 16.51 15.09Tier 1 capital ratio, % 18.67 17.43 18.85 18.67 18.85 17.48Total capital ratio, % 18.62 17.70 18.56 18.62 18.56 17.22

Number of full time equivalents1) 15 762 16 023 16 480 15 925 17 105 16 925

Assets under custody, SEK billion 5 814 5 411 4 788 5 814 4 788 5 191Assets under management, SEK billion 1 427 1 387 1 271 1 427 1 271 1 328

Discontinued operationsBasic earnings per share, discontinued operations, SEK 0.00 -0.01 -0.07 -0.01 -0.22 -0.22Diluted earnings per share, discontinued operations, SEK 0.00 -0.01 -0.07 -0.01 -0.22 -0.22

4) According to Swedish FSA regulations for respective period.5) 80 per cent of RWA in Basel I

1) Quarterly numbers are for last month of quarter. Accumulated numbers are average for the period.

Jan - Sep

2) The number of issued shares was 2,194,171,802. SEB owned 2,188,734 Class A shares for the equity-based programmes at year end 2012. During 2013 SEB has repurchased 17,500,000 shares and 18,871,496 shares have been sold. Thus, as at 30 September 2013 SEB owned 817,238 Class A-shares with a market value of SEK56m.3) Calculated dilution based on the estimated economic value of the long-term incentive programmes.

In SEB’s Fact Book, this table is available with nine quarters’ history.


Income statement on quarterly basis - SEB Group Q3 Q2 Q1 Q4 Q3

SEK m 2013 2013 2013 2012 2012Net interest income 4 759 4 677 4 459 4 458 4 466Net fee and commission income 3 735 3 811 3 247 3 715 3 192Net financial income 825 1 087 954 982 1 091Net life insurance income 794 689 882 831 861Net other income* 211 384 9 - 349 71Total operating income 10 324 10 648 9 551 9 637 9 681

Staff costs -3 474 -3 613 -3 556 -3 672 -3 602Other expenses -1 457 -1 481 -1 581 -1 628 -1 573Depreciation, amortisation and impairment of tangible and intangible assets** - 522 - 491 - 451 -1 224 - 464Total operating expenses -5 453 -5 585 -5 588 -6 524 -5 639

Profit before credit losses 4 871 5 063 3 963 3 113 4 042

Gains less losses from disposals of tangible and intangible assets 14 11 10 2 1Net credit losses - 267 - 291 - 256 - 276 - 186Operating profit 4 618 4 783 3 717 2 839 3 857

Income tax expense*** - 865 - 975 - 705 401 - 868Net profit from continuing operations 3 753 3 808 3 012 3 240 2 989

Discontinued operations - 17 - 1 - 155Net profit 3 753 3 791 3 012 3 239 2 834

Attributable to minority interests 2 1 3 7 4Attributable to shareholders 3 751 3 790 3 009 3 232 2 830

Continuing operations Basic earnings per share, SEK 1.71 1.74 1.37 1.47 1.36 Diluted earnings per share, SEK 1.70 1.72 1.36 1.47 1.36

Total operations Basic earnings per share, SEK 1.71 1.73 1.37 1.47 1.29 Diluted earnings per share, SEK 1.70 1.72 1.36 1.47 1.29

*** The positive income tax expense in Q4 2012 is a result of the reduction of the Swedish corporate tax rate, which has had a one-off effect of SEK 1.1bn from revaluation of deferred tax assets and liabilities.

** As a result of the strategic review of the IT development portfolio, non-used parts of the portfolio have been derecognised as intangible assets. The cost, SEK 753m, arising from this has been recognised in Q4 2012.

* Repurchase of covered bonds has had a negative effect on Net other income of SEK 402m in Q4 2012. Repurchase of subordinated debt gave a net positive effect of SEK 201m in Q2 2013.


Income statement by Division – SEB Group

Jan-Sep 2013, SEK mMerchant

BankingRetail

BankingWealth

Management Life BalticOther incl

eliminations SEB GroupNet interest income 5 394 5 709 511 - 46 1 463 864 13 895Net fee and commission income 4 129 2 979 2 405 722 558 10 793Net financial income 2 567 278 104 288 - 371 2 866Net life insurance income 3 397 -1 032 2 365Net other income 188 59 63 - 20 314 604Total operating income 12 278 9 025 3 083 3 351 2 453 333 30 523

Staff costs -2 769 -2 238 - 915 - 886 - 474 -3 361 -10 643Other expenses -3 329 -2 227 - 954 - 428 - 721 3 140 -4 519Depreciation, amortisation and impairment of tangible and intangible assets - 112 - 50 - 28 - 696 - 66 - 512 -1 464Total operating expenses -6 210 -4 515 -1 897 -2 010 -1 261 - 733 -16 626

Profit before credit losses 6 068 4 510 1 186 1 341 1 192 - 400 13 897

Gains less losses from disposals of tangible and intangible assets - 1 36 35Net credit losses - 183 - 382 - 6 - 242 - 1 - 814Operating profit 5 884 4 128 1 180 1 341 986 - 401 13 118

Wealth Management and Life are held together in a new division, Life & Wealth Management but are still presented separately.


Macroeconomic development

-10-8-6-4-202468

10

2010 2011 2012 2013 2014

Sweden Denmark FinlandNorway Eurozone

Source: Macrobond, SEB

0.0

0.5

1.0

1.5

2.0

2.5

3.0

2010 2011 2012 2013 2014

Sweden Norway Eurozone



-15

-10

-5

0

5

10

15

2010 2011 2012 2013 2014

Estonia Latvia Lithuania


Nordic and eurozone GDP development and SEB forecast (year-on-year % change) • In Sweden, SEB’s biggest market, proactive fiscal policy initiatives

and rising employment will support growth in 2014. • In Denmark, inflation has fallen and housing prices have stabilised

helping household confidence rise to a five-year high. • In Norway, rapidly growing capital spending will slow in 2014 but

exports and robust real household incomes will fuel growth. • In Finland, low capacity utilisation, rising unemployment and a tight

fiscal policy are holding back capital spending and consumption. • The eurozone economy is stabilising, but political challenges in the

region continue. Key interest rate development and SEB forecast • The European central bank is expected to supply more liquidity via a

new round of long-term loans. The refi rate is expected to be cut from 0.50 to 0.25 per cent in December 2013.

• Sweden’s central bank is expected to raise its repo rate for the first time at the end of 2014.

• Norway’s central bank is expected to hike its deposit rate by 50 basis points in the second half of 2014.

Exchange rate development and SEB forecast • During the third quarter 2013, the Swedish krona strengthened

against both the euro and the US dollar, by 1 and 5 per cent, respectively.

• SEB expects a stronger Swedish krona. The euro rate is expected to reach 8.40 at the end of 2014.

Baltic GDP development and SEB forecast (year-on-year % change) • The economies in the Baltic countries are in balance. • Estonian GDP growth slows in 2013 due to declining public

investments and lower exports and will rebound somewhat in 2014. • Latvian GDP growth is the highest within the EU, at 4 per cent this

year. Latvia is approved to join the eurozone in 2014. • Lithuanian GDP growth is expected to remain around 4 per cent and

the country is likely to convert to the euro in 2015.

SEB’s forecast reflects the view of the Bank’s macroeconomists.


SEB’s markets SEB offers universal financial advice and services in Sweden and the Baltic countries. In Denmark, Finland, Norway and Germany, the bank’s operations have a strong focus on corporate and investment banking based on a full-service offering to corporate and institutional clients. In addition, SEB serves its corporate and institutional customers through its international network. Profit per country Distribution by country Jan - Sep

SEK m 2013 2012 % 2013 2012 % 2013 2012 % 2013 2012 %Sweden 18 319 16 603 10 -10 846 -10 773 1 7 139 5 542 29 7 139 5 542 29Norway 2 350 2 464 - 5 - 895 -1 028 - 13 1 398 1 374 2 1 247 1 182 5Denmark 2 201 2 255 - 2 - 975 -1 068 - 9 1 181 1 144 3 1 026 974 5Finland 1 169 1 072 9 - 448 - 472 - 5 716 596 20 83 68 22Germany* 2 169 2 237 - 3 -1 275 -1 355 - 6 828 855 - 3 97 96 1Estonia** 847 905 - 6 - 387 - 405 - 4 486 515 - 6 57 59 - 3Latvia** 725 768 - 6 - 360 - 386 - 7 174 188 - 7 14 15 - 7Lithuania** 1 059 1 059 0 - 553 - 640 - 14 465 404 15 187 160 17Other countries and eliminations 1 684 1 823 - 8 - 887 -1 001 - 11 731 778 - 6Total 30 523 29 186 5 -16 626 -17 128 - 3 13 118 11 396 15

*Excluding centralised Treasury operations**Profit before credit losses increased in Lithuania by 21 per cent and in Latvia and Estonia there was a decrease with 5 and 8 per cent respectively.

Operating profitin local currencyTotal operating income Total operating expenses Operating profit

• Sweden’s share of Group operating profit increased to 54 per cent due to higher customer activity

• Reduced operating expenses in all core markets internationally

• Continued growth of the credit portfolio in SEB’s key growth markets

Comments on the first nine monthsTotal operating profit in Sweden increased by 29 per cent and represented 54 per cent of the Group. Operating income increased by 10 per cent year-on-year and all divisions had a higher income level. Continuous growth in both private and corporate lending resulted in higher net interest income year–on-year. Corporate transactions and custody and mutual funds generated higher fee income. The cost base increased by 1 per cent but the number of employees continued to decrease.

In Norway, operating income in 2013 started out lower than 2012, but improved significantly in the third quarter. Market volatility and uncertainty affected the level of income year-to-date, but with strong net interest income and fees and commissions, operating income was in line with the 2012 level. Total costs were reduced by 13 per cent which led to an operating profit at approximately the same level as year-to-date 2012.

In Denmark, operating profit increased by 5 per cent, in local currency, compared to the same period last year. The

positive performance was mainly driven by increased corporate customer activities across the divisions; taking on new customers as well as extended business volume with existing customers. Merchant Banking and Wealth Management performed particularly well. Total costs decreased by 7 per cent in local currency.

In Finland, operating profit increased by 22 per cent in local currency. Customer activity increased in Merchant Banking and there was a positive cost efficiency effect for both Merchant Banking and Wealth Management.

In Germany, operating profit was virtually unchanged. Overall, the German corporate banking market position improved and investment banking products were in demand. Wealth Management income was affected by difficult market conditions, however operating income was only slightly below the corresponding period 2012.

In Lithuania, operating profit increased while it decreased in Estonia and Latvia. See also the information on the Baltic division.


Merchant Banking The Merchant Banking division offers commercial and investment banking services to large corporate and institutional clients, mainly in the Nordic region and Germany. Customers are also served through an extensive international presence.

Income statement Q3 Q2 Q3 Full year

SEK m 2013 2013 % 2012 % 2013 2012 % 2012

Net interest income 1 862 1 801 3 1 676 11 5 394 5 269 2 6 966Net fee and commission income 1 535 1 562 - 2 1 115 38 4 129 3 535 17 4 896Net financial income 712 961 - 26 786 - 9 2 567 2 846 - 10 3 683Net other income 169 18 127 33 188 308 - 39 292Total operating income 4 278 4 342 - 1 3 704 15 12 278 11 958 3 15 837

Staff costs - 919 - 935 - 2 - 950 - 3 -2 769 -2 948 - 6 -3 945Other expenses -1 112 -1 122 - 1 -1 098 1 -3 329 -3 348 - 1 -4 465Depreciation, amortisation and impairment of tangible and intangible assets - 36 - 42 - 14 - 42 - 14 - 112 - 124 - 10 - 182Total operating expenses -2 067 -2 099 - 2 -2 090 - 1 -6 210 -6 420 - 3 -8 592

Profit before credit losses 2 211 2 243 - 1 1 614 37 6 068 5 538 10 7 245

Gains less losses from disposals of tangible and intangible assets - 1 - 1 - 6 - 83 - 6Net credit losses - 99 - 59 68 - 18 - 183 - 129 42 - 130

Operating profit 2 111 2 184 -3 1 596 32 5 884 5 403 9 7 109

Cost/Income ratio 0,48 0,48 0,56 0,51 0,54 0,54Business equity, SEK bn 50,2 49,3 36,3 49,2 36,5 36,7Return on business equity, % 13,0 13,7 13,0 12,3 14,6 14,3Number of full time equivalents 2 216 2 228 2 429 2 258 2 422 2 418

Nota bene: The higher capital allocation in 2013 reflects the alignment to the future 12 per cent Common Equity Tier 1 requirement in the Basel III framework.

Jan- Sep

• Higher corporate customer activity level and solid asset quality

• Facilitated the first Green Bond issue in the Nordic countries for the City of Gothenburg

• Return on business equity at par with third quarter 2012 despite significantly higher capital allocation

Comments on the first nine monthsAfter a slow start of the year, the third quarter showed an increased demand for corporate and investment banking services, but also a seasonal slowdown in customer activity within Markets. The positive market sentiment from the second quarter was more muted in the third quarter due to increased political uncertainty in the Middle East and the United States.

The corporate customers increased their activity levels, however the typical seasonal slowdown lead to decreased activity levels from financial institutions. Mergers, acquisitions and equity capital market activities continued to pick up from thin volumes at the beginning of the year. Corporate lending volumes increased marginally at the same time as corporate customers continued to utilise SEB to tap the bond market.

Operating income for the first nine months increased by 3 per cent compared with 2012 reflecting a stronger demand for corporate and investment banking services. Net interest income increased in line with the credit exposure. Net fee and commission income increased as a reflection of the pick-up in

customer activity especially in the second and third quarter. Operating expenses decreased by 3 per cent compared with the first nine months of 2012. Operating profit increased by 9 per cent year-on-year, and by 32 per cent compared to the third quarter 2012. Asset quality remained strong with low net credit losses.

The second phase of growth in the Nordic and German markets continued according to plan: to deepen relationships with existing customers and to continue to attract new clients. During the first nine months of 2013, 74 new customers were added, in line with the progress since 2010.

Some 50 per cent of corporate refinancing takes place in the corporate bond markets, which is a larger portion than before the crisis. SEB has continued to invest in new professionals to bring a larger number of issuers to the market and attract more investors both in the primary as well as secondary market. One recent example is the Green Bond that the City of Gothenburg issued during September.


Retail Banking The Retail Banking division offers full banking and advisory services to private individuals and small and medium-sized corporate customers in Sweden, as well as card services in the Nordic countries.


SEK m 2013 2013 % 2012 % 2013 2012 % 2012

Net interest income 1 956 1 924 2 1 796 9 5 709 5 296 8 7 117Net fee and commission income 1 003 1 007 0 886 13 2 979 2 691 11 3 648Net financial income 84 106 - 21 79 6 278 253 10 339Net other income 20 27 - 26 19 5 59 52 13 76Total operating income 3 063 3 064 0 2 780 10 9 025 8 292 9 11 180

Staff costs - 725 - 752 - 4 - 755 - 4 -2 238 -2 293 - 2 -3 024Other expenses - 729 - 743 - 2 - 787 - 7 -2 227 -2 421 - 8 -3 266Depreciation, amortisation and impairment of tangible and intangible assets - 14 - 17 - 18 - 24 - 42 - 50 - 65 - 23 - 85Total operating expenses -1 468 -1 512 - 3 -1 566 - 6 -4 515 -4 779 - 6 -6 375

Profit before credit losses 1 595 1 552 3 1 214 31 4 510 3 513 28 4 805

Gains less losses from disposals of tangible and intangible assetsNet credit losses - 97 - 154 - 37 - 99 - 2 - 382 - 333 15 - 452

Operating profit 1 498 1 398 7 1 115 34 4 128 3 180 30 4 353



Jan- Sep

• The focus on relationship banking continued to attract more full-service customers

• Corporate lending increased by 10 per cent

• Higher return on business equity

Comments on the first nine months The strategic initiative to grow the business continued during the third quarter and activities on both the private and corporate market remained high. This increased operating profit to SEK 4,128m (3,180).

Net interest income amounted to SEK 5,709m for the first nine months (5,296). Growth of residential mortgage lending decelerated during the third quarter while portfolio margins were slightly up. 13,200 new home bank customers were added. Costs continued to trend down as cost efficiencies were realised and the cost/income ratio now trends below 0.50. The credit losses amounted to SEK 382m indicating a continued solid asset quality (333).

SEB continued to develop its offering for the digital channels making it easier for all customers to interact with the bank. An upgraded smartphone application for private

customers was launched in August and more customers continued to visit the bank via mobile channels than through the internet bank. In addition, an upgraded version of the current internet bank was developed and subsequently released in October.

Relations with the corporate customers intensified during the third quarter and corporate lending grew by 10 per cent since the beginning of the year to SEK 167bn. 7,400 new full- service customers chose SEB as their house bank.

The turnover in the Card business was unchanged compared to last year following growth in the issuing business and a downturn of acquiring business. In addition to new services and functionalities for the corporate market, SEB Kort launched a new co-branded card “SEB Selected”, for Private Banking.


Wealth Management The Wealth Management operations offer a full spectrum of asset management and advisory services to institutions and high net-worth individuals, including a Nordic private banking offering.

Income statement

Q3 Q2 Q3 Full year

SEK m 2013 2013 % 2012 % 2013 2012 % 2012

Net interest income 174 180 - 3 160 9 511 509 0 667Net fee and commission income 752 832 - 10 733 3 2 405 2 318 4 3 244Net financial income 14 52 - 73 30 - 53 104 66 58 97Net other income 1 60 - 98 - 7 63 27 133 30Total operating income 941 1 124 - 16 916 3 3 083 2 920 6 4 038

Staff costs - 301 - 297 1 - 339 - 11 - 915 - 991 - 8 -1 322Other expenses - 304 - 349 - 13 - 333 - 9 - 954 -1 051 - 9 -1 379Depreciation, amortisation and impairment of tangible and intangible assets - 9 - 9 0 - 10 - 10 - 28 - 32 - 13 - 43Total operating expenses - 614 - 655 - 6 - 682 - 10 -1 897 -2 074 - 9 -2 744

Profit before credit losses 327 469 - 30 234 40 1 186 846 40 1 294

Gains less losses from disposals of tangible and intangible assetsNet credit losses - 6 - 1 - 6 1 - 5

Operating profit 321 468 - 31 234 37 1 180 847 39 1 289

Cost/Income ratio 0,65 0,58 0,74 0,62 0,71 0,68Business equity, SEK bn 8,4 8,3 5,8 8,4 6,0 6,0Return on business equity, % 11,8 17,3 12,0 14,5 13,9 16,0Number of full time equivalents 876 890 913 897 948 940


Jan- Sep

• Positive momentum, with continued customers’ confidence, in Private Banking; net inflow SEK 23bn

• Continued high interest for SEB’s niche alternative products among institutional customers

• Improved nine-month return on business equity

Comments on the first nine months The operating profit of SEK 1,180m increased by 39 per cent compared with the same period last year. Base commissions, at a total of SEK 2,029m (1,996), increased mainly due to a positive stock market development resulting in higher average asset values. Margins were slightly lower. Performance and transaction fees amounted to SEK 122m (87), mainly increasing due to higher performance fee from discretionary mandates.

Operating expenses decreased by 9 per cent compared to last year to SEK 1,897m (2,074). Compared to the second quarter 2013, net fee and commission income dropped due to seasonal effects relating to lower transaction fees and customer activities.

During the third quarter, SEB was awarded a number of strategically important institutional mandates, both in Sweden and internationally. SEB’s newly launched closed-end funds were well received on the market. In addition, institutional customers increased their investments in SEB’s other niche

alternative products. Overall, mainly due to structural changes, there was a net outflow of SEK 7bn from institutions since year-end.

SEB continued to improve the customer offering for mutual funds, where SEB’s equity and mixed funds had positive inflows. This was complemented by carefully selected external funds, in which there was still significant inflow especially into external high-yield products.

Private Banking continued to attract new customers; 723 new clients (775), as well as SEK 23bn in new volumes since the beginning of the year (21). The launch of a new exclusive card for Private Banking clients in the Swedish market, “SEB’s Selected”, was well received by clients and strengthened the holistic offering further.

The division’s total assets under management amounted to an all-time high SEK 1,341bn (1,176). This was an increase of 9 per cent from year-end.


Life

Life offers life insurance products with a focus on unit-linked insurance for private individuals and corporate customers, mainly in Sweden, Denmark and the Baltic countries.


SEK m 2013 2013 % 2012 % 2013 2012 % 2012

Net interest income - 10 - 18 - 44 - 20 - 50 - 46 - 68 - 32 - 86Net life insurance income 1 155 1 024 13 1 179 - 2 3 397 3 558 - 5 4 707Total operating income 1 145 1 006 14 1 159 - 1 3 351 3 490 - 4 4 621

Staff costs - 297 - 289 3 - 294 1 - 886 - 909 - 3 -1 214Other expenses - 131 - 151 - 13 - 137 - 4 - 428 - 409 5 - 537Depreciation, amortisation and impairment of tangible and intangible assets - 229 - 236 - 3 - 224 2 - 696 - 681 2 - 890Total operating expenses - 657 - 676 - 3 - 655 0 -2 010 -1 999 1 -2 641

Profit before credit losses 488 330 48 504 - 3 1 341 1 491 - 10 1 980

Operating profit 488 330 48 504 - 3 1 341 1 491 - 10 1 980



Jan- Sep

• The ranking of the fund offering for unit-linked improved in the third quarter

• Premium income continued to grow

• Third quarter return on business equity improved

Comments on the first nine monthsSEB’s position in the annual survey “Marknadsindikatorn” among insurance intermediaries in Sweden, improved to the top-three. SEB was number one on the Swedish market for unit-linked insurance and held the same position for the prioritised segment of unit-linked occupational pension. In Lithuania, a loan payment insurance product was launched in September. The product is now offered in all three Baltic countries and has been well received by the customers.

The operating profit for the first nine months amounted to SEK 1,341m (1,491). The second quarter, where the traditional portfolios were negatively affected by rising long-term interest rates and declining stock markets, was followed by the opposite market development in the third quarter. The unit-linked income developed positively and improved by 5 per cent to SEK 2,102m during the first nine months. The increase in income was mainly a result of higher fund values. The unit-linked business continues to provide a major part of the total income. For the first nine months, the share was 63 per cent. The decline in total income compared to last year, was mainly

due to a lower result in the traditional portfolios and in the risk business. Expenses were virtually unchanged compared to last year. Expenses before commissions to sales channels decreased by 4 per cent or SEK 55m to 1,322m.

Total premium income relating to new and existing policies continued to increase compared to the same period last year and amounted to SEK 23bn, which was 14 per cent higher. The improvement was primarily a result of growth in the Irish operations. Premiums also increased slightly in Denmark and in the Baltics, but decreased in Sweden.

The weighted sales volume of new policies decreased by 1 per cent from last year and amounted to SEK 29bn. Unit-linked business represented 88 per cent of sales (83) and the share of corporate paid policies was 72 per cent (76).

The total fund value in unit-linked amounted to SEK 224bn which is 24bn higher than a year ago and up 20bn since year-end. In the first nine months, net inflow was SEK 5bn and the appreciation in value was SEK 15bn or 7 per cent. Total assets under management amounted to SEK 463bn.


Baltic The Baltic division provides full banking and advisory services to private individuals and small and medium-sized corporate customers in Estonia, Latvia and Lithuania. The Baltic real estate holding companies (RHC) are part of the division. The full Baltic geographical segmentation, including other activities in the region, is reported in SEB’s Fact Book.


SEK m 2013 2013 % 2012 % 2013 2012 % 2012

Net interest income 526 487 8 482 9 1 463 1 509 - 3 1 970Net fee and commission income 248 243 2 233 6 722 673 7 919Net financial income 98 110 - 11 103 - 5 288 324 - 11 423Net other income - 5 - 11 - 55 - 4 25 - 20 - 8 150 - 11Total operating income 867 829 5 814 7 2 453 2 498 - 2 3 301

Staff costs - 161 - 158 2 - 162 - 1 - 474 - 509 - 7 - 681Other expenses - 241 - 240 0 - 250 - 4 - 721 - 761 - 5 -1 080Depreciation, amortisation and impairment of tangible and intangible assets - 22 - 22 0 - 32 - 31 - 66 - 97 - 32 - 280Total operating expenses - 424 - 420 1 - 444 - 5 -1 261 -1 367 - 8 -2 041

Profit before credit losses 443 409 8 370 20 1 192 1 131 5 1 260

Gains less losses from disposals of tangible and intangible assets 15 11 36 5 200 36 8 9Net credit losses - 66 - 78 - 15 - 70 - 6 - 242 - 202 20 - 351

Operating profit 392 342 15 305 29 986 937 5 918


Baltic Banking (excl RHC)

Operating profit 404 356 13 326 24 1 027 1 004 2 1 016

Cost/Income ratio 0,47 0,48 0,52 0,49 0,52 0,59Business equity, SEK bn 8,1 8,7 8,4 8,6 8,7 8,7Return on business equity, % 17,7 14,6 14,0 14,2 14,2 10,9


Jan- Sep

• Gradual recovery of customer activity and credit demand

• Operating profit increased by 5 per cent year-on-year

• Third quarter return on business equity improved

Comments on the first nine months The Baltic countries have been the fastest-growing economies in the EU since 2011. Growth in Estonia decelerated somewhat in 2013, while growth in Latvia and Lithuania remained fairly strong. The Baltic GDP growth was driven by stable and slowly rising private consumption.

Baltic loan volumes amounted to SEK 100bn (96). Of this, 16, 18 and 24 per cent are corporate loans in Estonia, Latvia and Lithuania, respectively. Mortgage loans grew by 1 per cent in Estonia and decreased by 1 per cent in Lithuania and by 6 per cent in Latvia. Lending margins remained relatively stable across the portfolio with slightly higher margins on new loans.

Baltic deposit volumes amounted to SEK 70bn (64). With low deposit margins prevailing in each of the Baltic countries, net interest income declined 1 per cent in local currencies

year-on-year. However, net interest income increased by 7 per cent in the third quarter (in local currency).

Total operating expenses were 6 per cent lower than the first nine months of 2012, excluding the currency effect. The operating profit improved by 5 per cent year-on-year, and by 15 per cent in the third quarter. Non-performing loans declined by 42 per cent in SEK year-on-year. The non-performing loans coverage ratio was 64 per cent. The net credit loss level was 32 basis points for the first nine months.

SEB was named Best Bank in Lithuania and in Estonia by Euromoney and best internet bank in Latvia by Global Finance. In Estonia and Lithuania, SEB launched enhanced mobile banking services for smartphones and tablet computers.

The real estate holding companies held assets at a total book value of SEK 2,660m (1,950).


The SEB Group Net interest income – SEB Group

Q3 Q2 Q3 Full yearSEK m 2013 2013 % 2012 % 2013 2012 % 2012Interest income 12 147 12 567 - 3 13 179 - 8 37 035 41 006 - 10 53 794Interest expense -7 388 -7 890 - 6 -8 713 - 15 -23 140 -27 829 - 17 -36 159Net interest income 4 759 4 677 2 4 466 7 13 895 13 177 5 17 635

Jan - Sep

Net fee and commission income – SEB Group Q3 Q2 Q3 Full year

SEK m 2013 2013 % 2012 % 2013 2012 % 2012Issue of securities and advisory 154 161 - 4 92 67 380 405 - 6 646Secondary market and derivatives 482 647 - 26 501 - 4 1 624 1 460 11 1 940Custody and mutual funds 1 631 1 702 - 4 1 564 4 4 990 4 853 3 6 691Payments, cards, lending, deposits, guarantees and other 2 587 2 515 3 2 133 21 7 276 6 658 9 9 059 Whereof payments and card fees 1 463 1 516 - 3 1 479 - 1 4 400 4 460 - 1 5 952 Whereof lending 828 675 23 442 87 1 957 1 439 36 2 047Fee and commission income 4 854 5 025 - 3 4 290 13 14 270 13 376 7 18 336

Fee and commission expense -1 119 -1 214 - 8 -1 098 2 -3 477 -3 471 0 -4 716

Net fee and commission income 3 735 3 811 - 2 3 192 17 10 793 9 905 9 13 620

Jan - Sep

Net financial income – SEB Group Q3 Q2 Q3 Full year

SEK m 2013 2013 % 2012 % 2013 2012 % 2012Equity instruments and related derivatives 727 7 289 152 694 530 31 518Debt instruments and related derivatives - 654 442 - 8 85 835 -90 972Currency and related derivatives 659 650 1 809 - 19 2 030 2 278 -11 3 163Other 93 - 12 1 57 - 46 - 74Net financial income 825 1 087 -24 1 091 - 24 2 866 3 597 -20 4 579

Jan - Sep

Year to date the positive effect from structured products offered to the public was approximately SEK 510m (360) in Equity related instruments and a corresponding negative effect in Debt related instruments.

The result within Net financial income is presented on different rows based on type of underlying financial instrument. Changes in the Treasury result are due to changes in interest rates and credit spreads. The net effect from trading operations is fairly stable over time, although affected by seasonality, but shows volatility between lines.

In the third quarter 2013 structured products offered to the public (such as equity index linked bonds) generated a positive effect of approximately SEK 640m in Equity related instruments (the effect in the previous quarter was negative at SEK 200m) and a corresponding negative effect in Debt related instruments (positive in the second quarter).


Net credit losses – SEB Group Q3 Q2 Q3 Full year

SEK m 2013 2013 % 2012 % 2013 2012 % 2012Provisions:Net collective provisions for individually assessed loans - 51 160 - 62 -18 78 - 20 104Net collective provisions for portfolio assessed loans 230 90 156 - 84 550 - 111 - 148Specific provisions 81 - 380 2 - 492 - 442 11 - 532Reversal of specific provisions no longer required 95 83 14 186 -49 253 472 -46 557Net provisions for off-balance sheet items - 1 1 2 6 23 -74 23Net provisions 354 - 46 44 395 - 78 4

Write-offs:Total write-offs -1 607 - 651 147 - 741 117 -3 077 -1 885 63 -2 892Reversal of specific provisions utilized for write-offs 954 378 152 484 97 1 772 1 220 45 1 814Write-offs not previously provided for - 653 - 273 139 - 257 154 -1 305 - 665 96 -1 078Recovered from previous write-offs 32 28 14 27 19 96 82 17 137Net write-offs - 621 - 245 153 - 230 170 -1 209 - 583 107 - 941

Net credit losses - 267 - 291 -8 - 186 44 - 814 - 661 23 - 937

Jan - Sep


Statement of changes in equity – SEB Group

SEK mShare

capitalRetained earnings

Available-for-sale

financial assets

Cash flow hedges

Translation of foreign

operations

Defined benefit

plans

Total Share-holders'

equityMinority interests

Total Equity

Jan-Sep 2013

Opening balance 21 942 90 033 273 1 688 -2 422 -2 091 109 423 90 109 513

Net profit 10 550 10 550 6 10 556

Other comprehensive income (net of tax) 660 -1 255 43 3 140 2 588 -4 2 584

Total comprehensive income 10 550 660 -1 255 43 3 140 13 138 2 13 140Dividend to shareholders -6 004 -6 004 -63 -6 067

Employee share programme1) -956 -956 -956Change in holdings of own shares 41 41 41

Closing balance 21 942 93 664 933 433 -2 379 1 049 115 642 29 115 671

Jan-Dec 2012

Opening balance 21 942 82 272 -1 003 1 107 -1 752 -88 102 478 261 102 739

Net profit 11 632 11 632 22 11 654

Other comprehensive income (net of tax) 1 276 581 -670 -2 003 -816 -816

Total comprehensive income 11 632 1 276 581 -670 -2 003 10 816 22 10 838Dividend to shareholders -3 795 -3 795 -3 795

Employee share programme1) -113 -113 -113Minority interests -193 -193Change in holdings of own shares 37 37 37

Closing balance 21 942 90 033 273 1 688 -2 422 -2 091 109 423 90 109 513

Jan-Sep 2012

Opening balance 21 942 82 272 -1 003 1 107 -1 752 -88 102 478 261 102 739

Net profit 8 398 8 398 15 8 413

Other comprehensive income (net of tax) 735 429 -1 033 -445 -314 -2 -316

Total comprehensive income 8 398 735 429 -1 033 -445 8 084 13 8 097Dividend to shareholders -3 795 -3 795 -193 -3 988

Employee share programme1) -224 -224 -224Change in holdings of own shares 38 38 38

Closing balance 21 942 86 689 -268 1 536 -2 785 -533 106 581 81 106 662

Jan-Sep Jan-Dec Jan-SepNumber of shares owned by SEB, million 2013 2012 2012Opening balance 2,2 2,3 2,3

Repurchased shares 17,5 12,0 10,2Sold/distributed shares -18,9 -12,1 -11,3Closing balance 0,8 2,2 1,2

Market value of shares owned by SEB, SEK m 56 121 66

Other reserves

1) The acquisition cost for the purchase of own shares is deducted from shareholders' equity.The item includes changes in nominal amounts of equity swaps used for hedging of equity-based programmes.

Amounts under Other reserves may be reclassified in the future to the income statement under certain circumstances, e.g. if they are related to the sale of Available for sale financial assets, dissolved Cash flow hedges or Translation of foreign operations when SEB ceases to consolidate a foreign operation. Amounts related to Defined benefit plans will not be reclassified to the income statement.

In accordance with the decision by the Annual General Meeting, SEB holds own shares of Class A for the long-term equity-based programmes. The transactions may take place at one or serveral occasions during the year.


Cash flow statement – SEB Group Full year

SEK m 2013 2012 % 2012Cash flow from operating activities 50 099 - 28 219 - 6 653Cash flow from investment activities - 1 391 - 778 79 - 1 278Cash flow from financing activities - 8 138 - 4 721 72 - 4 682Net increase in cash and cash equivalents 40 570 - 33 718 - 12 613

Cash and cash equivalents at the beginning of year 257 292 276 853 - 7 276 853Exchange rate differences on cash and cash equivalents - 1 568 - 6 674 - 77 - 6 948Net increase in cash and cash equivalents 40 570 - 33 718 - 12 613

Cash and cash equivalents at the end of period1) 296 294 236 461 25 257 292

Jan - Sep

1) Cash and cash equivalents at the end of period is defined as Cash and cash balances with central banks, Other lending to central banks and Loans to other credit institutions payable on demand.

Financial assets and liabilities – SEB Group

SEK mCarrying

amount Fair valueCarrying

amount Fair value

Loans 1 622 262 1 662 845 1 519 759 1 539 032

Equity instruments 155 341 155 341 110 409 110 409

Debt instruments 340 436 337 310 340 894 340 326

Derivative instruments 143 043 143 043 169 679 169 679

Financial assets - policyholders bearing the risk 223 468 223 468 203 333 203 333

Other 25 290 25 290 58 712 58 712

Financial assets 2 509 840 2 547 297 2 402 786 2 421 491

Deposits 1 138 904 1 189 217 1 032 916 1 043 939

Equity instruments 38 741 38 741 34 161 34 161

Debt instruments 760 391 766 346 729 192 739 195

Derivative instruments 139 092 139 092 157 861 157 861

Liabilities to policyholders - investment contracts 214 224 214 224 195 620 195 620

Other 26 240 25 608 56 580 56 685

Financial liabilities 2 317 592 2 373 228 2 206 330 2 227 461

SEB has grouped its financial instruments by class taking into account the characteristics of the instruments. The fair value of each class of financial assets and liabilities are compared with its carrying amount. A description of the characteristics of the classes can be found in note 41 in the Annual Report 2012.

30 Sep 2013 31 Dec 2012


Assets and liabilities measured at fair value – SEB Group SEK m

Assets

Quoted prices in active markets (Level 1)

Valuation technique

using observable

inputs (Level 2)

Valuation technique using non-observable

inputs (Level 3) Total

Quoted prices in active markets (Level 1)

Valuation technique

using observable

inputs (Level 2)

Valuation technique using non-observable

inputs (Level 3) Total

Financial assets - policyholders bearing the risk 217 404 4 423 1 641 223 468 189 480 12 294 1 559 203 333Equity instruments 113 912 30 703 10 164 154 779 79 970 21 563 8 667 110 200Debt instruments 108 881 193 672 1 528 304 081 131 674 158 654 1 867 292 195Derivative instruments 357 141 537 1 150 143 044 110 167 741 1 828 169 679

Investment in associates1) 1 039 1 039 1 073 1 073Investment properties 7 604 7 604 7 488 7 488

Total 440 554 370 335 23 126 834 015 401 234 360 252 22 482 783 968

Liabilities

Liabilities to policyholders - investment contracts 209 124 3 894 1 206 214 224 182 293 11 827 1 500 195 620Equity instruments 37 032 1 335 374 38 741 32 532 1 629 34 161Debt instruments 21 513 13 815 35 328 35 403 7 657 43 060Derivative instruments 681 136 965 1 446 139 092 501 154 716 2 644 157 861

Other issued securities2) 28 091 28 091 26 323 26 323

Total 268 350 184 100 3 026 455 476 250 729 202 152 4 144 457 025

1) Venture capital activities designated at fair value through profit and loss.

2) Equity index link bonds designated at fair value through profit and loss.

Sensitivity of Level 3 assets and liabilities to unobservable inputs

SEK m Assets Liabilities Net Sensitivity Assets Liabilities Net Sensitivity

Structured Derivatives - interest rate1) 476 -902 -426 59 951 -1 504 -553 58

Capital Markets2) 371 -34 337 21 351 -52 299 20

CPM Portfolio3) 57 57 11 139 139 15

Venture Capital holding and similar holdings4) 1 651 -374 1 277 255 1 183 1 183 224

11 076 -161 10 915 1 559 9 867 -105 9 762 1 501

8 915 8 915 891 7 488 7 488 749

1) Sensitivity from a shift of index-linked swap spreads by 5 basis points (5) and implied volatilities by 5 percentage points (5).2) Sensitivity from a shift of swap spreads by 5 basis points (5) .

Insurance holdings - Financial instruments5)

Insurance holdings - Investment properties6)

The table below illustrates the potential Profit or Loss impact of the relative uncertainty in the fair value of assets and liabilities measured at fair value that for their valuation are dependent on unobservable inputs. The sensitivity to unobservable inputs is assessed by altering the assumptions to the valuation techniques, illustrated below by changes in index-linked swap spreads, implied volatilities, credit spreads or comparator multiples. It is unlikely that all unobservable inputs would be simultaneously at the extremes of their ranges of reasonably possible alternatives.

30 Sep 2013 31 Dec 2012

The largest open market risk within Level 3 assets and liabilities is found within the insurance business.There have been no significant changes of sensitivity during Q3 2013.

6) Sensitivity from a shift of investment properties fair values of 10 per cent (10).

5) Sensitivity analysis is based on a shift in private equity of 20 per cent (20), structured credits 10 per cent (10) and derivative market values of 10 per cent (10).

3) Sensitivity from a shift of credit spreads by 100 basis points (100).4) Valuation is estimated in a range of reasonable outcomes. Sensitivity analysis is based on 20 per cent shift in market values.

Risk control has the overall responsibility for classifying assets and liabilities as being in level 1, 2 or 3. The valuation process is the same for financial instruments in all levels. Market Risk Control is responsible for validating the prices used for valuation of financial instruments. In case of disagreement, there is an escalation process in place, whereby the product area head or equivalent can submit an escalation to the relevant pricing / valuation committee. The Valuation committee covers topics such as valuation of illiquid instruments, model validation findings, analysis of changes in fair value measurements and shocks on level 3 assets. The chairman of the Valuation Committee is appointed by the Head of Market Risk Control and the committee has permanent members from Divisional risk management, Group Finance and Market Risk Control.

30 Sep 2013 31 Dec 2012

Financial assets and liabilities carried at fair value are classified in a fair value hierarchy according to the level of observability of prices or inputs used in a valuation technique. As part of the fair value measurement credit value adjustments (CVA) are incorporated into the derivative valuations for OTC-derivatives on a portfolio basis. The valuation techniques and inputs used for the fair value measurement are described in detail in the Annual Report 2012.

Financial assets - policyholders bearing the risk, Investment properties and Liabilities to policyholders - investment contracts are included in the table which is a change compared to the Annual Report 2012.

Transfers between levels may occur when there are indications that market conditions have changed, e.g. a change in liquidity. There have been no significant transfers between level 1 and level 2 during the period however there has been a reclassification of assets from level 2 to level 1 in the amount of SEK 10bn due to enhanced classification within the insurance business. There were changes in Level 3 financial instruments mainly due to valuation effects and from purchases and sales of Equity, Debt and Derivative instruments. In addition there has been a reclassification in the amount of SEK 2.2bn (11) of Equity instruments due to enhanced classification, from level 2 to level 3, within the insurance business.

Fair value gains and losses recognised in the income statement are included in the Net financial income, Net life insurance income and Net other income.


Financial assets and liabilities subject to offsetting or netting arrangements – SEB Group

SEK m Gross amounts Offset

Net amounts in

balance sheetMaster netting arrangements

Collaterals received/

pledged Net amountsTotal in

balance sheet

30 Sep 2013

Derivatives 134 943 -7 048 127 895 -96 589 -22 879 8 427 15 148 143 043

Reversed repo receivables 87 049 -6 453 80 596 -16 211 -64 299 86 27 577 108 173

Securities borrowing 46 931 -4 673 42 258 -9 014 -30 128 3 116 3 335 45 593

Client receivables 10 257 -10 257 11 285 11 285

Assets 279 180 -28 431 250 749 -121 814 -117 306 11 629 57 345 308 094

Derivatives 137 949 -7 048 130 901 -96 589 -19 417 14 895 8 191 139 092

Repo payables 29 843 -6 453 23 390 -16 211 -7 140 39 16 338 39 728

Securities lending 30 387 -4 673 25 714 -9 014 -15 959 741 12 326 38 040

Client payables 10 257 -10 257 8 063 8 063

Liabilities 208 436 -28 431 180 005 -121 814 -42 516 15 675 44 918 224 923

31 Dec 2012

Derivatives 167 184 -12 459 154 725 -103 738 -43 882 7 105 14 954 169 679


Securities borrowing 39 637 -3 905 35 732 -834 -32 018 2 880 9 426 45 158


Assets 305 819 -29 866 275 953 -113 942 -151 582 10 429 80 297 356 250

Derivatives 159 697 -12 459 147 238 -103 738 -20 652 22 848 10 623 157 861

Repo payables 19 060 -5 926 13 134 -9 370 -3 764 15 701 28 835

Securities lending 28 362 -3 905 24 457 -834 -22 271 1 352 8 937 33 394

Client payables 7 576 -7 576 31 012 31 012

Liabilities 214 695 -29 866 184 829 -113 942 -46 687 24 200 66 273 251 102

30 Sep 2012

Derivatives 174 788 -4 594 170 194 -122 123 -25 725 22 346 5 711 175 905


Securities borrowing 54 702 -15 146 39 556 -6 019 -31 079 2 458 39 556


Assets 352 485 -42 474 310 011 -141 556 -143 272 25 183 49 020 359 031

Derivatives 165 228 -4 594 160 634 -122 123 -24 993 13 518 2 015 162 649

Repo payables 18 154 -2 084 16 070 -13 414 -2 655 1 17 190 33 260

Securities lending 52 334 -15 146 37 188 -6 019 -29 844 1 325 37 188

Client payables 20 650 -20 650 9 318 9 318

Liabilities 256 366 -42 474 213 892 -141 556 -57 492 14 844 28 523 242 415

Financial assets and liabilities are presented net in the statement of financial position when SEB has legally enforceable rights to set-off, in the ordinary cause of business and in the case of bankruptcy, and intends to settle on a net basis or to realize the assets and settle the liabilities simultaneously. Repos with central counterparty clearing houses that SEB has agreements with and client receivables and client payables are examples of instruments that are presented net in the statement of financial position.

Financial assets and liabilities subject to enforceable master netting arrangements or similar arrangements that are not presented net in the statement of financial position are arrangements that are usually enforceable in the case of bankruptcy or default but not in the ordinary course of business or arrangements where SEB does not have the intention to settle the instruments simultaneously.

Assets and liabilities that are not subject to offsetting or netting arrangements, i.e those that are only subject to collateral agreements, are presented as Other instruments in balance sheet.

Related arrangements

Other instruments in balance sheet not subject to

netting arrangements

Financial assets and liabilities subject to offsetting or netting arrangements

The table shows financial assets and liabilities that are presented net in the statement of financial position or with potential rights to off-set associated with enforceable master netting arrangements or similar arrangements, together with related collateral. The Net amounts show the exposure in the case of normal business as well as in the events of default or bankruptcy.


Reclassified portfolios – SEB Group

Q3 Q2 Q3 Full yearSEK m 2013 2013 % 2012 % 2013 2012 % 2012

ReclassifiedOpening balance 23 148 26 193 -12 33 207 -30 29 342 42 169 -30 42 169Amortisations -1 120 -2 248 -50 - 737 52 -4 013 -2 034 97 -2 862Securities sold -1 051 -2 009 -48 56 -4 866 -7 045 -31 -8 656Accrued coupon 7 - 14 -150 25 -72 30 41 -27 9Exchange rate differences - 399 1 226 -133 -1 738 -77 92 -2 318 -104 -1 318Closing balance* 20 585 23 148 - 11 30 813 - 33 20 585 30 813 -33 29 342* Market value 20 189 22 555 -10 29 597 -32 20 189 29 597 -32 28 423

In Equity (AFS origin) - 15 210 -107 310 -105 372 875 -57 1 117In Income Statements (HFT origin) 2 24 -92 23 -91 30 119 -75 217Total - 13 234 -106 333 -104 402 994 -60 1 334

Effect in Income Statements**Net interest income 80 75 7 125 -36 243 499 -51 602Net financial income - 286 635 -145 -1 041 -73 38 -1 336 -103 - 639Other income - 18 - 3 - 26 - 390 -93 - 391Total - 224 710 -132 - 919 -76 255 -1 227 -121 - 428

Fair value impact - if not reclassified

Jan - Sep

** The effect in the Income Statement is the profit or loss transactions from the reclassified portfolio reported gross. Net interest income is the interest income from the portfolio without taking into account the funding costs. Net financial income is the foreign currency effect related to the reclassified portfolio but does not include the off-setting foreign currency effects from financing activities. Other income is the realised gains or losses from sales in the portfolio.


Non-performing loans – SEB Group 30 Sep 31 Dec 30 Sep

SEK m 2013 2012 2012

Individually assessed impaired loansImpaired loans, past due > 60 days 4 882 7 234 7 469Impaired loans, performing or past due < 60 days 365 767 994Total individually assessed impaired loans 5 247 8 001 8 463

Specific reserves - 2 621 - 4 165 - 4 394 for impaired loans, past due > 60 days - 2 377 - 3 783 - 4 024 for impaired loans, performing or past due < 60 days - 244 - 382 - 370Collective reserves - 1 716 - 1 790 - 1 882Impaired loans net 910 2 046 2 187

Specific reserve ratio for individually assessed impaired loans 50.0% 52.1% 51.9%Total reserve ratio for individually assessed impaired loans 82.7% 74.4% 74.2%

Net level of impaired loans 0.19% 0.28% 0.30%Gross level of impaired loans 0.37% 0.58% 0.62%

Portfolio assessed loansPortfolio assessed loans past due > 60 days 4 534 5 389 5 678Restructured loans 371 450 442

Collective reserves for portfolio assessed loans - 2 362 - 2 914 - 2 926

Reserve ratio for portfolio assessed loans 48.2% 49.9% 47.8%

ReservesSpecific reserves - 2 621 - 4 165 - 4 394Collective reserves - 4 078 - 4 704 - 4 808Reserves for off-balance sheet items - 289 - 299 - 507Total reserves - 6 988 - 9 168 - 9 709

Non-performing loansNon-performing loans* 10 152 13 840 14 583NPL coverage ratio 68.8% 66.2% 66.6%NPL % of lending 0.72% 1.01% 1.06%* Impaired loans + portfolio assessed loans past due > 60 days + restructured portfolio assessed loans

Seized assets – SEB Group 30 Sep 31 Dec 30 Sep

SEK m 2013 2012 2012Properties, vehicles and equipment 2 846 2 251 2 055Shares 46 49 49Total seized assets 2 892 2 300 2 104


Discontinued operations – SEB Group Income statement

Q3 Q2 Q3 Full yearSEK m 2013 2013 % 2012 % 2013 2012 % 2012Total operating income 3 3 0 104 -97 40 227 -82 305Total operating expenses - 14 - 21 -33 - 97 -86 - 77 - 556 -86 - 645Profit before credit losses - 11 - 18 -39 7 0 - 37 - 329 -89 - 340

Net credit losses - 20 -100 - 179 -100 - 20 - 181 -89 - 181Operating profit - 11 - 38 -71 - 172 -94 - 57 - 510 -89 - 521

Income tax expense 11 21 -48 17 -35 40 23 74 33Net profit from discontinued operations 0 - 17 -100 - 155 -100 - 17 - 487 -97 - 488

Jan - Sep

Assets and liabilities held for sale 30 Sep 31 Dec 30 Sep

SEK m 2013 2012 2012Loans to the publicOther assetsTotal assets held for sale 0 0 0

Deposits from credit institutionsDeposits and borrowing from the publicOther liabilitiesTotal liabilities held for sale 0 0 0

Cash flow statement

Q3 Q2 Q3 Full yearSEK m 2013 2013 % 2012 % 2013 2012 % 2012Cash flow from operating activities - 61 - 43 42 27 - 129 13 0 65Cash flow from investment activities 38 - 100 38Cash flow from financing activities 61 43 42 - 29 129 140 - 8 87Net increase in cash and cash equivalents from discontinued operations 0 0 - 2 0 191 - 100 190

Discontinued operations includes the work to finalise the operational separation of the divested retail operations in Germany and Ukraine.

Jan - Sep


SEB financial group of undertakings Capital base of the SEB financial group of undertakings

30 Sep 31 DecSEK m 2013 2012Total equity according to balance sheet 115 671 109 513Dividend (excl repurchased shares) -4 524 -6 028Investments outside the financial group of undertakings -65 -64Other deductions outside the financial group of undertakings -2 078 -4 451= Total equity in the capital adequacy 109 004 98 970

Adjustment for hedge contracts 1 205 -473Net provisioning amount for IRB-reported credit exposures -276 0Unrealised value changes on available-for-sale financial assets -1 333 -597Exposures where RWA is not calculated -675 -802Goodwill -4 057 -4 147Other intangible assets -2 465 -2 559Deferred tax assets -1 672 -2 003= Core Tier 1 capital 99 731 88 389

Tier 1 capital contribution (non-innovative) 4 334 4 300Tier 1 capital contribution (innovative) 9 658 9 704Investments in insurance companies -6 538= Tier 1 capital 107 185 102 393

Dated subordinated debt 6 567 6 515Deduction for remaining maturity -53 -39Perpetual subordinated debt 656 1 890Net provisioning amount for IRB-reported credit exposures -276 485Unrealised gains on available-for-sale financial assets 1 270 990Exposures where RWA is not calculated -675 -802Investments outside the financial group of undertakings -65 -64Investments in insurance companies -6 538= Tier 2 capital 886 8 975

Investments in insurance companies 0 -10 501Pension assets in excess of related liabilities -1 160 0= Capital base 106 911 100 867

The deduction for investments in insurance companies, which was earlier made from the total capital base, has been changed from 2013 so that half is deducted from Tier 1 capital and the remaining half from Tier 2 capital.

The valuation of the Swedish defined pension plan resulted in an equity increase, which strengthened the core Tier 1 and Tier 1 capital ratios. The total capital ratio was not affected since the pension surplus, less tax and the amount of pension assets that are unrestricted for Bank use, is deducted from the total capital base. Under the Basel III framework, this surplus is deducted from the Common Equity Tier 1 capital.

On 30 September 2013 the parent company's core Tier 1 capital was SEK 93,039m (88,093 at September 2012) and the reported core Tier 1 capital ratio was 13.1 per cent (13.8 at September 2012).


Risk-weighted assets for the SEB financial group of undertakings

Risk-weighted assets 30 Sep 31 DecSEK m 2013 2012

Credit risk IRB approachInstitutions 22 074 23 879Corporates 335 634 326 666Securitisation positions 4 638 5 177Retail mortgages 42 039 42 896Other retail exposures 10 440 9 365Other exposure classes 1 480 1 461Total credit risk IRB approach 416 305 409 444

Further risk-weighted assetsCredit risk, Standardised approach 66 345 68 125Operational risk, Advanced Measurement approach 39 778 40 219Foreign exchange rate risk 5 674 14 042Trading book risks 45 968 54 009Total risk-weighted assets 574 070 585 839

SummaryCredit risk 482 650 477 569Operational risk 39 778 40 219Market risk 51 642 68 051Total 574 070 585 839

Adjustment for flooring rulesAddition according to transitional flooring 336 552 293 398Total reported 910 622 879 237


Capital adequacy analysis for the SEB financial group of undertakings Capital adequacy 30 Sep 31 DecSEK m 2013 2012

Capital resourcesCore Tier 1 capital 99 731 88 389Tier 1 capital 107 185 102 393Capital base 106 911 100 867

Capital adequacy without transitional floor (Basel II)Risk-weighted assets 574 070 585 839Expressed as capital requirement 45 926 46 867Core Tier 1 capital ratio 17.4% 15.1%Tier 1 capital ratio 18.7% 17.5%Total capital ratio 18.6% 17.2%Capital base in relation to capital requirement 2.33 2.15

Capital adequacy including transitional floorTransitional floor applied 80% 80%Risk-weighted assets 910 622 879 237Expressed as capital requirement 72 850 70 339Core Tier 1 capital ratio 11.0% 10.1%Tier 1 capital ratio 11.8% 11.6%Total capital ratio 11.7% 11.5%Capital base in relation to capital requirement 1.47 1.43

Capital adequacy with risk-weighting according to Basel IRisk-weighted assets 1 146 914 1 091 468Expressed as capital requirement 91 753 87 317Core Tier 1 capital ratio 8.7% 8.1%Tier 1 capital ratio 9.3% 9.4%Total capital ratio 9.3% 9.2%Capital base in relation to capital requirement 1.17 1.16

RWA development Overall Basel II risk-weighted assets (RWA) before the effect of transitional flooring decreased by 2 per cent, or SEK 12bn, since year-end.

Un-floored Basel II RWA was 50 per cent lower than Basel I RWA. The ultimate target is to use IRB reporting for all credit exposures except those to central governments, central banks and local governments and authorities and a small number of insignificant portfolios.

The Basel III framework The Basel III framework, in the form of the CRD IV/CRR regulatory package, was adopted by the European Parliament in June 2013. The new rules apply from 1 January 2014 and are now in the process of being transposed into Swedish legislation. Due to the Swedish legislative process the implementation of CRD IV, the directive part of the CRD IV/CRR package, is likely to be delayed and the expected implementation date for this part is 1 July 2014. The CRR part is a regulation and hence applicable law in all member states when adopted by the EU.

CRD IV covers the implementation of buffer requirements, Pillar 2, etc. while CRR contains the minimum requirements and all technical calculation standards. The CRR rules establishes explicit minimum levels for Common Equity Tier 1 and Tier 1 capital and requires banks to hold more and higher quality capital. RWA will mainly be affected by an additional so-called credit value adjustment requirement for OTC-derivatives, new requirements for exposures on central counterparties, and an increase in risk weights for exposures on financial institutions.

In 2011, the Swedish government communicated stricter capital requirements than those stipulated under Basel III; a 12 per cent Common Equity Tier 1 requirement from 2015 (on a Basel III/CRD IV fully implemented basis).

Risk-weighted assets SEK bn

Balance 31 December 2012 586Volumes changes 13Currency effect -2

RWA processes / regulatory changes 1Risk class migration -4Risk-weight changes -3Market risk changes -16Other -1Balance 30 September 2013 574


The following table summarises average risk weights (Risk-Weighted Assets, RWA, divided by Exposure At Default, EAD) for exposures where RWA is calculated following the internal ratings based (IRB) approach. Repos and securities

lending transactions are excluded from the analysis since they carry low risk-weight and can vary considerably in volume, thus making numbers less comparable.

IRB reported credit exposures (less repos and securities lending) 30 Sep 31 DecAverage risk-weight 2013 2012

Institutions 18.2% 15.9%Corporates 40.1% 40.8%Securitisation positions 35.5% 34.7%Retail mortgages 9.7% 10.4%Other retail exposures 38.6% 37.4%

On 21 May 2013 the Swedish Financial Supervisory Authority decided to implement a 15 per cent floor for Swedish mortgage risk weights on portfolio level. The risk weight floor will be handled under Pillar 2 and does not affect the risk weights under Pillar 1.


Skandinaviska Enskilda Banken AB (publ) Income statement – Skandinaviska Enskilda Banken AB (publ) In accordance with FSA regulations Q3 Q2 Q3 Full yearSEK m 2013 2013 % 2012 % 2013 2012 % 2012Interest income 8 738 9 055 -4 9 169 -5 26 485 28 581 -7 38 470Leasing income 1 393 1 407 -1 1 405 -1 4 199 4 393 -4 5 817Interest expense -5 374 -5 778 -7 -6 217 -14 -16 746 -20 080 -17 -26 809Dividends 2 875 1 950 47 737 4 825 2 189 120 2 214Fee and commission income 2 609 2 548 2 1 931 35 7 332 6 347 16 8 963Fee and commission expense - 418 - 434 -4 - 320 31 -1 191 -1 067 12 -1 523Net financial income 687 988 -30 951 -28 2 499 3 097 -19 4 046Other income 1 180 380 248 1 725 447 159Total operating income 11 690 10 116 16 7 904 48 29 128 23 907 22 31 337

Administrative expenses -3 524 -3 507 0 -3 379 4 -10 449 -10 509 -1 -15 077Depreciation, amortisation and impairment of tangible and intangible assets -1 245 -1 273 -2 -1 205 3 -3 770 -3 712 2 -5 446Total operating expenses -4 769 -4 780 0 -4 584 4 -14 219 -14 221 0 -20 523

Profit before credit losses 6 921 5 336 30 3 320 108 14 909 9 686 54 10 814

Net credit losses - 84 - 155 -46 - 68 24 - 336 - 298 13 - 385Impairment of financial assets - 11 - 1 -1 094 -99 - 13 -1 094 -99 -1 114Operating profit 6 826 5 180 32 2 158 14 560 8 294 76 9 315

Appropriations 388 143 171 547 -29 858 1 226 -30 -3 175Income tax expense - 832 - 382 118 - 839 -1 -2 071 -2 326 -11 -1 289Other taxes 2 -100 - 13 - 86Net profit 6 382 4 943 29 1 866 13 334 7 194 85 4 765

Jan - Sep

Statement of comprehensive income – Skandinaviska Enskilda Banken AB (publ) Q3 Q2 Q3 Full year

SEK m 2013 2013 % 2012 % 2013 2012 % 2012Net profit 6 382 4 943 29 1 866 13 334 7 194 85 4 765

Items that may subsequently be reclassified to the income statement:Available-for-sale financial assets 164 - 34 108 52 616 139 693Cash flow hedges - 55 - 651 -92 689 -108 -1 253 432 584Translation of foreign operations - 25 12 - 26 -4 - 25 - 41 -39 - 72Other comprehensive income (net of tax) 84 - 673 -112 771 -89 - 662 530 1 205

Total comprehensive income 6 466 4 270 51 2 637 145 12 672 7 724 64 5 970

Jan - Sep


Balance sheet - Skandinaviska Enskilda Banken AB (publ) Condensed 30 Sep 31 Dec 30 Sep

SEK m 2013 2012 2012Cash and cash balances with central banks 226 497 165 994 101 726Loans to credit institutions 193 838 200 189 247 512Loans to the public 989 669 937 734 935 143Financial assets at fair value 447 340 426 326 412 129Available-for-sale financial assets 19 457 17 610 16 897Held-to-maturity investments 84 1 636 1 602Investments in associates 997 1 044 1 035Shares in subsidiaries 51 369 50 671 51 203Tangible and intangible assets 41 282 43 026 41 587Other assets 36 364 64 823 42 365Total assets 2 006 897 1 909 053 1 851 199

Deposits from credit institutions 254 344 199 711 250 295Deposits and borrowing from the public 681 404 637 721 564 384Debt securities 693 033 641 413 634 950Financial liabilities at fair value 202 515 232 062 229 898Other liabilities 47 381 74 097 46 666Provisions 96 160 68Subordinated liabilities 22 020 24 213 24 119Untaxed reserves 26 346 26 346 25 049Total equity 79 758 73 330 75 770Total liabilities, untaxed reserves and shareholders' equity 2 006 897 1 909 053 1 851 199

Pledged assets, contingent liabilities and commitments - Skandinaviska Enskilda Banken AB (publ) 30 Sep 31 Dec 30 Sep

SEK m 2013 2012 2012Collateral and comparable security pledged for own liabilities 325 810 294 990 293 280Other pledged assets and comparable collateral 117 974 119 577 118 080Contingent liabilities 80 442 78 565 76 653Commitments 328 692 315 157 302 667


This is SEB

Mission To help people and businesses thrive by providing quality advice and financial resources.

Vision To be the trusted partner for customers with aspirations.

Customers and markets 2,800 large corporates and institutions, 400,000 SMEs and 4 million private customers bank with SEB. They are mainly located in eight markets around the Baltic Sea.

Brand promise Rewarding relationships.

Corporate objectives The leading Nordic bank for corporates and institutions. The top universal bank in Sweden and the Baltic countries.

Strategic value-driving priorities Long-term customer relationships – build and develop relationships based on the customers’ long-term needs with a holistic perspective. Growth in areas of strength – pursue growth in three selected core areas – large corporations and financial institutions in the Nordic countries and Germany, small and medium-sized companies in Sweden, and a holistic savings offering. Resilience and flexibility – ensure the financial strength needed to demonstrate stability and resilience as well as the flexibility to adapt operations in a cost-efficient manner to the prevailing market conditions.

People 16,000 highly skilled people serving customers from locations in some 20 countries; covering different time zones, securing reach and local market knowledge.

Values Guided by our Code of Business Conduct and our core values: professionalism, commitment, mutual respect and continuity.

History Over 150 years of business, building trust and sharing knowledge. The Bank has always acted responsibly in society promoting entrepreneurship, international outlook and long-term relationships.

Additional financial information is available in SEB’s Fact Book which is published quarterly on www.sebgroup.com/ir

Documents

“During the first nine Interim Report months, corporate ... · Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Operating income SEK bn * Adjusted for one- off effects Operating profit SEK bn 10.8